CMED China Medical Technologies ADS, Each Representing 10 Ordinary Shares (MM)

BEIJING, Sept. 30 /PRNewswire-Asia-FirstCall/ -- China Medical Technologies, Inc. (the "Company") (NASDAQ:CMED), a leading China-based medical device company that develops, manufactures and markets advanced in- vitro diagnostic products, today announced the filing of its annual report on Form 20-F for the fiscal year ended March 31, 2009 with the U.S. Securities and Exchange Commission (the "SEC"). The annual report, which contains its consolidated financial statements for the fiscal year ended March 31, 2009 audited by its new independent auditors, PricewaterhouseCoopers, and comparative consolidated financial statements for the fiscal year ended March 31, 2008 audited by its former independent auditors, KPMG, can be accessed on the Company's investor relations website at http://ir.chinameditech.com/. Shareholders can receive a hard copy of the annual report free of charge by sending a request to . The Company has recently made the following adjustments on its previously reported unaudited quarterly and annual condensed consolidated statements of income which are setout below: Reclassification of expenses Reclassification of sales and marketing expenses related to the costs of free ECLIA analyzers to cost of revenues The Company considered that it was more appropriate to record the costs of ECLIA analyzers provided free of charge to the Company's customers starting from April 2008 in the cost of revenues rather than sales and marketing expenses. The reclassification of the expenses to cost of revenues covered the respective unaudited quarterly consolidated income statement for the quarters ended June 30, 2008, September 30, 2008, December 31, 2008, March 31, 2009 and June 30, 2009 and the unaudited annual consolidated income statement for the fiscal year ended March 31, 2009. Reclassification of foreign exchange gain (loss) from general and administrative expenses to other income (expense) The Company reclassified the foreign exchange gain (loss) from general and administrative expenses to other income (expense). The reclassification of the gain (loss) to other income (expense) covered the respective unaudited quarterly consolidated income statement for the quarters ended June 30, 2008, September 30, 2008, December 31, 2008, March 31, 2009 and June 30, 2009 and the unaudited annual consolidated income statement for the fiscal year ended March 31, 2009. Recognition of the full gain on the sale of the HIFU Business The Company recently received a letter from Chengxuan International Ltd. ("Chengxuan"), a major shareholder of the Company which is controlled and owned by the Company's Chairman and Chief Executive Officer, Mr. Xiaodong Wu. The letter notified the Company that Chengxuan withdrew its claim of compensation of approximately US$15.5 million against the Company for the events subsequent to the purchase of the HIFU Business from the Company. As such, the Company considered that the previous deferral of the gain of approximately US$15.5 million on the sale of the HIFU Business has become unnecessary and has recorded the full gain on the sale in the unaudited quarterly consolidated income statement for the quarter ended December 31, 2008 and the unaudited annual consolidated income statement for the fiscal year ended March 31, 2009. The respective unaudited quarterly and annual condensed consolidated statements of income have been adjusted and included in this press release. About China Medical Technologies, Inc. China Medical Technologies is a leading China-based medical device company that develops, manufactures and markets advanced in-vitro diagnostic products using Enhanced Chemiluminescence (ECLIA) technology, Fluorescent in situ Hybridization (FISH) technology and Surface Plasmon Resonance (SPR) technology to detect and monitor various diseases and disorders. For more information, please visit http://www.chinameditech.com/ . Contact Winnie Yam Tel: +852-2511-9808 Email: China Medical Technologies, Inc. Unaudited Condensed Consolidated Statements of Income For the Three Months Ended June 30, 2008 Adjustments June 30, 2008 RMB'000 RMB'000 RMB'000 As previously As adjusted reported on September 1, 2009 (1) Revenues 162,052 162,052 Cost of revenues (2) (51,270) (3,444) (54,714) Gross profit 110,782 107,338 Operating expenses: Research and development (6,138) (6,138) Sales and marketing (2) (11,285) 3,444 (7,841) General and administrative (3) (24,780) 2,755 (22,025) Total operating expenses (42,203) (36,004) Operating income 68,579 71,334 Interest income 3,997 3,997 Interest expense - convertible notes (16,285) (16,285) Interest expense - amortization of convertible notes issuance costs (1,585) (1,585) Interest expense - other (1,145) (1,145) Other expense (3) - (2,755) (2,755) Income before income taxes 53,561 53,561 Income tax expense (12,561) (12,561) Income from continuing operations 41,000 41,000 Income from discontinued Operation, net 32,377 32,377 Net income 73,377 - 73,377 Notes: (1) As a result of the adoption of FSP APB14-1 effective April 2009, the Company adjusted interest expense for convertible notes in the unaudited condensed consolidated statement of income for the three months ended June 30, 2008 retrospectively in accordance with U.S. GAAP. (2) The Company reclassified the costs of free ECLIA analyzers from sales and marketing expenses to cost of revenues. (3) The Company reclassified the foreign exchange loss from general and administrative expenses to other expense. China Medical Technologies, Inc. Unaudited Condensed Consolidated Statements of Income For the Three Months Ended September 30, September 30, 2008 Adjustments 2008 RMB'000 RMB'000 RMB'000 As previously As adjusted reported Revenues 193,967 193,967 Cost of revenues (1) (52,043) (5,265) (57,308) Gross profit 141,924 136,659 Operating expenses: Research and development (6,338) (6,338) Sales and marketing (1) (16,515) 5,265 (11,250) General and administrative (2) (26,859) 1,387 (25,472) Total operating expenses (49,712) (43,060) Operating income 92,212 93,599 Interest income 10,301 10,301 Interest expense - convertible notes (18,410) (18,410) Interest expense - amortization of convertible notes issuance costs (3,235) (3,235) Interest expense - other (1,145) (1,145) Other expense (2) - (1,387) (1,387) Income before income taxes 79,723 79,723 Income tax expense (14,423) (14,423) Income from continuing operations 65,300 65,300 Income from discontinued Operation, net 52,432 52,432 Net income 117,732 - 117,732 Notes: (1) The Company reclassified the costs of free ECLIA analyzers from sales and marketing expenses to cost of revenues. (2) The Company reclassified the foreign exchange loss from general and administrative expenses to other expense. China Medical Technologies, Inc. Unaudited Condensed Consolidated Statements of Income For the Three Months Ended December 31, December 31, 2008 Adjustments 2008 RMB'000 RMB'000 RMB'000 As previously As adjusted reported Revenues 225,296 225,296 Cost of revenues (1) (55,818) (2,897) (58,715) Gross profit 169,478 166,581 Operating expenses: Research and development (8,304) (8,304) Acquired in-process research and development (244,872) (244,872) Sales and marketing (1) (14,565) 2,897 (11,668) General and administrative (2) (3) (38,115) 8,554 (29,561) Amortization of SPR intangible assets (2) - (9,132) (9,132) Total operating expenses (305,856) (303,537) Operating loss (136,378) (136,956) Interest income 12,448 12,448 Interest expense - convertible notes (27,856) (27,856) Interest expense - amortization of convertible notes issuance costs (4,652) (4,652) Interest expense - other (1,165) (1,165) Other income (3) - 578 578 Loss before income taxes (157,603) (157,603) Income tax expense (13,915) (13,915) Loss from continuing operations (171,518) (171,518) Income from and gain on sale of discontinued Operation, net (4) 173,422 106,178 279,600 Net income 1,904 106,178 108,082 Notes: (1) The Company reclassified the costs of free ECLIA analyzers from sales and marketing expenses to cost of revenues. (2) The Company disclosed the amortization of SPR intangible assets separately from general and administrative expenses. (3) The Company reclassified the foreign exchange gain from general and administrative expenses to other income. (4) The Company recorded the full gain on the sale of the HIFU Business. China Medical Technologies, Inc. Unaudited Condensed Consolidated Statements of Income For the Three Months Ended March 31, March 31, 2009 Adjustments 2009 RMB'000 RMB'000 RMB'000 As previously As adjusted reported Revenues 248,635 248,635 Cost of revenues (1) (60,206) (1,628) (61,834) Gross profit 188,429 186,801 Operating expenses: Research and development (10,670) (10,670) Sales and marketing (1) (13,591) 1,628 (11,963) General and administrative (2) (3) (48,085) 27,547 (20,538) Amortization of SPR intangible assets (2) - (27,379) (27,379) Total operating expenses (72,346) (70,550) Operating income 116,083 116,251 Interest income 5,608 5,608 Interest expense - convertible notes (27,840) (27,840) Interest expense - amortization of convertible notes issuance costs (4,649) (4,649) Interest expense - other (785) (785) Other expense (3) - (168) (168) Income before income taxes 88,417 88,417 Income tax expense (32,143) (32,143) Income from continuing operations 56,274 56,274 Income from discontinued Operation, net - - Net income 56,274 - 56,274 Notes: (1) The Company reclassified the costs of free ECLIA analyzers from sales and marketing expenses to cost of revenues. (2) The Company disclosed the amortization of SPR intangible assets separately from general and administrative expenses. (3) The Company reclassified the foreign exchange loss from general and administrative expenses to other expense. China Medical Technologies, Inc. Unaudited Condensed Consolidated Statements of Income For the Three Months Ended June 30, 2009 Adjustments June 30, 2009 RMB'000 RMB'000 RMB'000 As previously As adjusted reported Revenues 208,957 208,957 Cost of revenues (1) (52,872) (2,541) (55,413) Gross profit 156,085 153,544 Operating expenses: Research and development (11,703) (11,703) Sales and marketing (1) (13,411) 2,541 (10,870) General and administrative (2) (3) (74,366) 27,412 (46,954) Amortization of SPR intangible assets (2) - (27,352) (27,352) Total operating expenses (99,480) (96,879) Operating income 56,605 56,665 Interest income 2,773 2,773 Interest expense - convertible notes (35,432) (35,432) Interest expense - amortization of convertible notes issuance costs (4,380) (4,380) Other income, net (3) 300 (60) 240 Income before income taxes 19,866 19,866 Income tax expense (16,919) (16,919) Income from continuing operations 2,947 2,947 Income from discontinued Operation, net - - Net income 2,947 - 2,947 Notes: (1) The Company reclassified the costs of free ECLIA analyzers from sales and marketing expenses to cost of revenues. (2) The Company disclosed the amortization of SPR intangible assets separately from general and administrative expenses. (3) The Company reclassified the foreign exchange loss from general and administrative expenses to other income, net. China Medical Technologies, Inc. Unaudited Condensed Consolidated Statements of Income For the Year Ended March 31, March 31, 2009 Adjustments 2009 RMB'000 RMB'000 RMB'000 As previously As adjusted reported Revenues 829,950 829,950 Cost of revenues (1) (219,337) (13,234) (232,571) Gross profit 610,613 597,379 Operating expenses: Research and development (31,450) (31,450) Acquired in-process research and development (244,872) (244,872) Sales and marketing (1) (55,956) 13,234 (42,722) General and administrative (2)(3) (137,839) 40,243 (97,596) Amortization of SPR intangible assets (2) - (36,511) (36,511) Total operating expenses (470,117) (453,151) Operating income 140,496 144,228 Interest income 32,354 32,354 Interest expense - convertible notes (83,238) (83,238) Interest expense - amortization of convertible notes issuance costs (14,387) (14,387) Interest expense - other (4,240) (4,240) Other expense, net (3) - (3,732) (3,732) Income before income taxes 70,985 70,985 Income tax expense (73,042) (73,042) Loss from continuing operations (2,057) (2,057) Income from and gain on sale of discontinued Operation, net (4) 258,231 106,178 364,409 Net income 256,174 106,178 362,352 Notes: (1) The Company reclassified the costs of free ECLIA analyzers from sales and marketing expenses to cost of revenues. (2) The Company disclosed the amortization of SPR intangible assets separately from general and administrative expenses. (3) The Company reclassified the foreign exchange loss, net from general and administrative expenses to other expense, net. (4) The Company recorded the full gain on the sale of the HIFU Business. DATASOURCE: China Medical Technologies CONTACT: Winnie Yam of China Medical Technologies, Inc., Tel: +852-2511- 9808, Email:

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